II 109th CONGRESS 2d Session S. 2255 IN THE SENATE OF THE UNITED STATES February 8, 2006 Mrs. Feinstein (for herself, Ms. Collins, Mr. Dorgan, Ms. Snowe, Mr. Bingaman, Mr. Chafee, Mrs. Clinton, Mr. Schumer, Mrs. Murray, and Mrs. Boxer) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend title XVIII of the Social Security Act to prohibit removal of covered part D drugs from a prescription drug plan formulary during the plan year once an individual has enrolled in the plan.

1.

Short title

This Act may be cited as the Medicare Drug Formulary Protection Act.

2.

Removal of covered part D drugs from the prescription drug plan formulary

(a)

Limitation on removal or change of covered part D drugs from the prescription drug plan formulary

Section 1860D–4(b)(3)(E) of the Social Security Act (42 U.S.C. 1395w–104(b)(3)(E)) is amended to read as follows: (E)

Removing a drug from formulary or imposing a restriction or limitation on coverage

(i)

Limitation on removal, limitation, or restriction

(I)

In general

Subject to subclause (II) and clause (ii), beginning with 2006, the PDP sponsor of a prescription drug plan may not remove a covered part D drug from the plan formulary or impose a restriction or limitation on the coverage of such a drug (such as through the application of a preferred status, usage restriction, step therapy, prior authorization, or quantity limitation) other than at the beginning of each plan year except as the Secretary may permit to take into account new therapeutic uses and newly covered part D drugs. (II)

Special rule for newly enrolled individuals

Subject to clause (ii), in the case of an individual who enrolls in a prescription drug plan on or after the date of enactment of this subparagraph, the PDP sponsor of such plan may not remove a covered part D drug from the plan formulary or impose a restriction or limitation on the coverage of such a drug (such as through the application of a preferred status, usage restriction, step therapy, prior authorization, or quantity limitation) during the period beginning on the date of such enrollment and ending on December 31 of the immediately succeeding plan year except as the Secretary may permit to take into account new therapeutic uses and newly covered part D drugs. (ii)

Exceptions to limitation on removal

Clause (i) shall not apply with respect to a covered part D drug that— (I)is a brand name drug for which there is a generic drug approved under section 505(j) of the Food and Drug Cosmetic Act (21 U.S.C. 355(j)) that is placed on the market during the period in which there are limitations on removal or change in the formulary under subclause (I) or (II) of clause (i); (II)is a brand name drug that goes off-patent during such period; (III)is a drug for which the Commissioner of Food and Drugs issues a clinical warning that imposes a restriction or limitation on the drug during such period; or (IV)has been determined to be ineffective during such period. (iii)

Notice of removal under application of exception to limitation

The PDP sponsor of a prescription drug plan shall provide appropriate notice (such as under subsection (a)(3)) of any removal or change under clause (ii) to the Secretary, affected enrollees, physicians, pharmacies, and pharmacists. . (b)

Notice for change in formulary and other restrictions or limitations on coverage

(1)

In general

Section 1860D–4(a) of such Act (42 U.S.C. 1395w–104(a)) is amended by adding at the end the following new paragraph: (5)

Annual notice of changes in formulary and other restrictions or limitations on coverage

Each PDP sponsor offering a prescription drug plan shall furnish to each enrollee at the time of each annual coordinated election period (referred to in section 1860D–1(b)(1)(B)(iii)) for a plan year a notice of any changes in the formulary or other restrictions or limitations on coverage of a covered part D drug under the plan that will take effect for the plan year. . (2)

Effective date

The amendment made by paragraph (1) shall apply to annual coordinated election periods beginning after the date of the enactment of this Act.